This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7947844.stm

The article has changed 12 times. There is an RSS feed of changes available.

Version 8 Version 9
RBS boss 'has taken £3m lump sum' Sir Fred 'to return' £3m advance
(about 2 hours later)
Former RBS chief executive Sir Fred Goodwin has already taken a £3m advance on his £703,000 annual pension, Treasury Minister Lord Myners has said. Banking group RBS has clarified that former chief executive Sir Fred Goodwin has agreed to pay back a £3m advance on his £703,000 annual pension.
The revelation came as Lord Myners said he "did not negotiate, settle, or approve" Sir Fred's pension. Its comments came after Treasury Minister Lord Myners revealed to MPs that Sir Fred had pocketed that amount.
Speaking to the Treasury Committee, Lord Myners reiterated that the decision was made by the RBS board. RBS said Sir Fred was now paying back the £3m. In either case, the overall value of his £16.9m pension pot would have been unaffected.
Lord Myners said RBS directors had been wrong in assuming they could not reduce Sir Fred's controversial pension deal. Lord Myners also reiterated that he had not approved Sir Fred's pension deal.
He said they had "consistently misdirected themselves" over the issue. Tax assurance
Sir Fred resigned from RBS in October after the bank needed a government rescue, and has continued to refuse to agree to have his pension reduced.Sir Fred resigned from RBS in October after the bank needed a government rescue, and has continued to refuse to agree to have his pension reduced.
Lord Myners said it was still not too late for Sir Fred "to do the right thing". Lord Myners says he "did not negotiate, settle, or approve" Sir Goodwin's pension
He added that Sir Fred had indicated that he may return the £3m advance in exchange for a larger pension pot. Sir Fred's overall pension pot stands at £16.9m. BBC business secretary Robert Peston said Sir Fred's almost £3m pension advance had actually been worth £4.5m, because RBS had agreed to pay his tax liability on it.
However, RBS denied this was the case, insisting that Sir Fred's pension pot could not, and would not be increased. He added that Sir Fred has agreed to pay back the money, "so long as he can get an assurance from HM Revenue & Customs that the tax man won't come after him for the... tax that would - in theory - still be due".
If he had been keeping the £3m, his annual pension income would have gone down from £703,000 a year to £555,000.
'Beyond comprehension''Beyond comprehension'
Lord Myners has found himself at the centre of the storm surrounding Sir Fred's pension after accusations that he effectively signed off the £16.9m package.
Speaking to the Treasury Committee on Wednesday he once again denied that this had been the case.
"The decision on the pension was made by the board directors of RBS. I made no decision," he said.
Lord Myners said he had been "very clear" with RBS and the other banks that there should be "no rewards for failure" and that payments for departing directors should be minimised.Lord Myners said he had been "very clear" with RBS and the other banks that there should be "no rewards for failure" and that payments for departing directors should be minimised.
There is still the option for Sir Fred to do the right thing Lord Myners Profile: Lord Myners
He added that it was "beyond my comprehension" that RBS directors had not exercised their discretion to reduce Sir Fred's pension.He added that it was "beyond my comprehension" that RBS directors had not exercised their discretion to reduce Sir Fred's pension.
"Someone at RBS took the decision to treat him [Sir Fred] more favourably than required," said Lord Myners."Someone at RBS took the decision to treat him [Sir Fred] more favourably than required," said Lord Myners.
Lord Myners said RBS was wrong to think it had no choice but to give Sir Fred his full pension from the age of 50, because this arrangement should only have been available to employees voluntarily retiring early. 'Quite straightforward'
He said RBS was wrong to think it had no choice but to give Sir Fred his full pension from the age of 50, because this arrangement should only have been available to employees voluntarily retiring early.
"Sir Fred Goodwin didn't have the option of staying. The board had decided he must go," he said."Sir Fred Goodwin didn't have the option of staying. The board had decided he must go," he said.
He added that the RBS board could have dismissed Sir Fred with just 12 months salary.He added that the RBS board could have dismissed Sir Fred with just 12 months salary.
"It would have been a quite straightforward and simple thing to have done," said Lord Myners."It would have been a quite straightforward and simple thing to have done," said Lord Myners.
RBS decision
Lord Myners has found himself at the centre of the storm surrounding Sir Fred's pension, facing accusations that he effectively signed off the former RBS chief executive's £16m pension pot.
He once again denied that this had been the case.
"The decision on the pension was made by the board directors of RBS. I made no decision," he said.
"My approval was not sought, I was given no information, I sought no information."
As an expert in pension funds, Lord Myners became financial services minister in October 2008, as the government was negotiating taking large stakes in RBS, Lloyds TSB and HBOS.As an expert in pension funds, Lord Myners became financial services minister in October 2008, as the government was negotiating taking large stakes in RBS, Lloyds TSB and HBOS.
Last month, RBS reported that it made a loss of £24.1bn in 2008 - the largest annual loss in UK corporate history.Last month, RBS reported that it made a loss of £24.1bn in 2008 - the largest annual loss in UK corporate history.
The government now owns a 68% stake in the lender.The government now owns a 68% stake in the lender.